As with most businesses, my tech business has had its share of ups and downs. Three years after its inception, it wasn’t doing quite well. We hadn’t made a profit and we had to lay off some employees to keep operating costs low. In the fourth year, things started looking up. We partnered with a number of overseas companies which made finding overseas clients easy. This however created new challenges. Partnerships usually meant that the business had to have some form of presence in our partner’s country. This lead to heavy investment in acquiring office space and hiring new employees which cut deep into our profits.
Although working with foreign companies did breathe new life into my business, the big break came when I got a huge contract from a Japanese company. What was interesting about the contract is that the company was willing to pay one and a half times more than what companies from the west were willing to pay. Apparently, my company’s IT products were in high demand in Japan and other East Asian countries.
This was an opening I wasn’t willing to forgo. If there was high demand for my products in East Asia, then that’s where my business was headed. My strategy was simple. I was to find a city that’s strategically placed within East Asia to act as my headquarters. Nagoya in Japan seemed the perfect location. Unlike most cities around the world, cities in East Asian countries were seeing massive growth which caused rent rates to skyrocket. Since my business wasn’t yet established, I wasn’t willing to take the risk of paying extraordinary rent rates.
I decided to get a virtual office in Nagoya. This would allow me to operate my company within East Asia. This was until the company was making enough profits to allow for renting commercial office space. My strategy worked out fine and, had it not been for the virtual space I rented in Nagoya, my business would be non-existent in the East Asian market.
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